“lack of inquiry”

Rectification & RevisionSection 263Section 2631,087 judgments

The decision most relied on for lack of inquiry is CIT v. Gabriel India Ltd. (203 ITR 108), cited in 990 judgments on BharatTax.

Leading authorities on lack of inquiry

CIT v. Gabriel India Ltd.

203 ITR 108 · 1993 · High Court

990

citing judgments

The Commissioner cannot revise an assessment order under Section 263 merely because they hold a different opinion or believe a deeper inquiry was warranted if the Assessing Officer has applied their mind and conducted some inquiry. Revision under Section 263 is permissible only in cases of a complete lack of inquiry or non-application of mind by the Assessing Officer, not for merely inadequate inquiry.

CIT v. Orissa Corporation Pvt. Ltd.

159 ITR 78 · 1986 · Supreme Court

897

citing judgments

When an assessee provides the identity and address of a creditor or investor for a cash credit or share capital under Section 68, the burden shifts to the Department to establish lack of genuineness or creditworthiness, requiring it to conduct further inquiries; mere non-compliance by third parties to summons cannot be the sole basis for an adverse inference against the assessee.

CIT v. Sunbeam Auto Ltd.

332 ITR 167 · 2011 · High Court

897

citing judgments

The Commissioner cannot revise an assessment under Section 263 merely because the assessment order does not explicitly reflect an inquiry, or because the Commissioner holds a different opinion. An inquiry, even if considered inadequate, or an assessment based on a plausible view by the Assessing Officer after due examination, does not automatically make the order erroneous or prejudicial to the interests of the revenue.

Gee Vee Enterprises v. Addl. CIT

99 ITR 375 · 1975 · High Court

543

citing judgments

An assessment order is erroneous and prejudicial to the interest of revenue if the Assessing Officer fails to make proper inquiries before accepting the assessee's statements or claims. The Commissioner can revise such an order under Section 263 without conducting further inquiries himself.

CIT v. Anil Kumar Sharma

335 ITR 83 · 2011 · High Court

264

citing judgments

The Commissioner cannot invoke Section 263 for an assessment merely because of an inadequate inquiry by the Assessing Officer, provided there was some inquiry or the record demonstrates application of mind, as this constitutes a mere difference of opinion.

Narayan Tatu Rane v. ITO

70 Taxmann.com 227 · 2016 · ITAT

220

citing judgments

Before revising an assessment order under Section 263, the CIT/PCIT must conduct their own inquiries or verifications to establish that the Assessing Officer's order is erroneous and unsustainable in law, rather than merely directing further inquiry or pointing out the AO's lack of inquiry.

DIT v. Jyoti Foundation

357 ITR 388 · 2013 · High Court

210

citing judgments

An assessment order cannot be deemed erroneous and prejudicial to the interest of revenue under Section 263 if the Assessing Officer conducted an inquiry and applied their mind during the original assessment, as Explanation 2 to Section 263 does not permit unending inquiries by the revisional authority.

CIT v. Infosys Technologies Ltd.

341 ITR 293 · 2012 · High Court

205

citing judgments

A Commissioner can revise an assessment order under Section 263 if it is erroneous and prejudicial to the interests of the revenue. This includes cases where the Assessing Officer fails to make further inquiries before accepting the assessee's statements in the return.

Judgments citing lack of inquiry

Siro Clinpharm P. Ltd, Mumbai vs. DCIT Cir 3(3), Mumbai

In the result, appeal of the assessee is allowed

ITA 2618/MUM/2014[2009-10]Status: DisposedITAT Mumbai31 Mar 2016AY 2009-10

Section 143(3)Section 250Section 80ISection 92CSection 92C(2)Section 92C(3)

I.T.A. Nos. 2618 and 2876/Mum/2014 Assessment year: 2009-10 Page 1 of 56 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI

Gitanjali Exports Corpon. Ltd, Mumbai vs. Addl CIT RG 5(1), Mumbai

In the result, while appeal of the Assessing Officer is dismissed, the appeal of the assessee is allowed

ITA 142/MUM/2014[2008-09]Status: DisposedITAT Mumbai31 Mar 2016AY 2008-09

Section 10ASection 143(3)Section 2Section 27Section 36(1)(iii)Section 51

held that “Learned counsel for the assessee is right in his submission that one has to keep in mind the distinction between "lack of inquiry" and "inadequate inquiry". If there was any inquiry, even inadequate that would not by itself give occasion to the CIT to pass orders under ... merely because he has different opinion in the matter. It is only in cases of "lack of inquiry" that such a course of action would be open”], it was reiterated that it was only the lack, not the adequacy, of inquiry which could confer jurisdiction under section

Firestone Diamond P.Ltd, Mumbai vs. ITO WD 8(1)(4), Mumbai

In the result, the appeal is allowed

ITA 139/MUM/2014[2008-09]Status: DisposedITAT Mumbai31 Mar 2016AY 2008-09

Section 143(3)Section 92BSection 92C

ACIT Cen Cir 2, Mumbai vs. Gitanjali Exports Corporation Ltd, Mumbai

In the result, while appeal of the Assessing Officer is dismissed, the appeal of the assessee is allowed

ITA 7662/MUM/2013[2008-09]Status: DisposedITAT Mumbai31 Mar 2016AY 2008-09

Section 10ASection 143(3)Section 2Section 27Section 36(1)(iii)Section 51

Jindal Steel & Power Ltd., New Delhi vs. ACIT, Hisar

In the result, the appeal of the assessee is partly allowed

ITA 3128/DEL/2014[2008-09]Status: DisposedITAT Delhi31 Mar 2016AY 2008-09

Bench: Sh. C.M. Garg & Sh. O.P. Kant

Section 143(3)Section 263

said to be a case of due application of mind. 28.1 Ld. Special counsel has rightly pointed out that the expression, 'inquiry', 'lack of inquiry' and 'inadequate inquiry', have not been defined and, therefore, when the action of the AO would be suggestive of lack of inquiry or inadequate inquiry ... laws would reach after due appreciation of such material. If this component is missing, it will always be a case of lack of inquiry and not inadequate inquiry. We find that ld. Commissioner, while considering this argument of assessee has observed that the representative of the assessee was assured that

Jindal Steel Power Ltd., New Delhi vs. CIT, Hisar

In the result, the appeal of the assessee is partly allowed

ITA 3283/DEL/2013[2008-09]Status: DisposedITAT Delhi31 Mar 2016AY 2008-09

Bench: Sh. C.M. Garg & Sh. O.P. Kant

Section 143(3)Section 263

M/S Vam-Hi-Fashion Garments Pvt. Ltd, New Delhi vs. ACIT, New Delhi

In the result, the appeal filed by the Assessee is allowed

ITA 494/DEL/2016[2010-11]Status: DisposedITAT Delhi21 Mar 2016AY 2010-11

Bench: Shri H.S. Sidhu & Shri Prashant Maharishi

For Appellant: Sh. R.S. Singhvi, CAFor Respondent: Sh. T. Vasanthan, Sr. DR

Section 142(1)Section 143(1)Section 143(2)Section 143(3)

Commissioner(Appeals). The Tribunal upheld the order of the Commissioner (Appeals).On appeal High Court held that, there was a clear lack of inquiry on the part of the Assessing Officer once the assessee had furnished all the relevant material. In such an eventuality no addition can be made under

ITO, New Delhi vs. M/S. Hira Realotors Pvt. Ltd., New Delhi

In the result the appeal of the revenue is dismissed

ITA 117/DEL/2012[2008-09]Status: DisposedITAT Delhi08 Mar 2016AY 2008-09

Bench: Shri H.S.Sidhu & Shri Prashant Maharishiito, Hira Realtors Pvt. Ltd., Ward-12(4), D-26, Defense Colony, Room No.331, Vs. New Delhi, C. R. Building, New Delhi New Delhi Pan:Aabch6352E (Appellant) (Respondent) Assessee By Sh. G.C.Srivastava, Adv Sh. Anubhav Jain, Adv Revenue By Sh.T.Vasanthan, Sr. Dr

Section 133(6)Section 68

tribunal to make/ direct inquiry in case the lower authorities fail to make inquiries. We are not of the view that there is lack of inquiry by AO as the transaction based on the evidence furnished is fully explained by the appellant and there is no material also which could

Shri Niranjan Lal Agarwal, Kolkata vs. DCIT, Circle -3, Kolkata

In the result, the appeal of the assessee is partly allowed

ITA 712/KOL/2012[2008-2009]Status: DisposedITAT Kolkata04 Mar 2016AY 2008-2009

Bench: Shri P.M. Jagtap & Shri S.S. Viswanethra Ravi

Section 143(3)Section 263Section 40Section 48

determination of head of income under which the jobbing profit is chargeable to tax but uphold the same on the issue of lack of inquiry made by the Assessing Officer to verify the revised figures furnished by the assessee. 8. In the result, the appeal of the assessee is partly

M/S. Thiess India Private Limited, Kolkata vs. ITO, Ward-12(4), Kolkata

In the result, assessee’s appeal is allowed

ITA 2290/KOL/2014[2011-2012]Status: DisposedITAT Kolkata10 Feb 2016AY 2011-2012

Bench: Shri Waseem Ahmed & Shri S.S.Viswanethra Raviassessment Year:2011-12

Section 143(3)Section 263Section 40A(2)(b)

alone, it has to be examined as to whether any inquiry was at all conducted by the AO. There exists a difference between lack of inquiry and inadequate inquiry. If there were any inquiry, even inadequate that would not give an occasion to exercise jurisdiction u/s 263 of ITA No.2290/Kol/2014

Rukmini (Koel) Mallick, Kolkata vs. CIT, -Xx, Kolkata

In the result, assessee’s appeal is allowed

ITA 1227/KOL/2014[2009-2010]Status: DisposedITAT Kolkata05 Feb 2016AY 2009-2010

Bench: Shri N.V.Vasusdevan & Shri Waseem Ahmedassessment Year :2009-10 Rukmini (Koel) Mallick V/S. Commissioner Of 14/106A, Golf Club Road, Income Tax-Xx Kolkata, Kolkata – 700 033 54/1, Rafi Ahmed [Pan No.Ajkpm 5044 L] Kidwai Road, Kolkata – 700 016 .. अपीलाथ" /Appellant ""यथ"/Respondent

Section 133ASection 143(3)Section 263

M/S Itc Limited, Kolkata vs. CIT, Kolkata-III, Kolkata

In the result, all the three appeals of assessee are allowed

ITA 684/KOL/2014[2008-2009]Status: DisposedITAT Kolkata03 Feb 2016AY 2008-2009

Bench: Shri N.V.Vasusdevan & Shri Waseem Ahmedassessment Year :2009-10 Assessment Year: 2008-09 Assessment Year: 2007-08

Section 143(3)Section 244ASection 263Section 43B

I.T.C Limited, Kolkata vs. C.I.T Kol - III, Kolkata

In the result, all the three appeals of assessee are allowed

ITA 1027/KOL/2013[2007-08]Status: DisposedITAT Kolkata03 Feb 2016AY 2007-08

Bench: Shri N.V.Vasusdevan & Shri Waseem Ahmedassessment Year :2009-10 Assessment Year: 2008-09 Assessment Year: 2007-08

Section 143(3)Section 244ASection 263Section 43B

Pravin L. Manania, Mumbai vs. ITO 17(2)(3), Mumbai

In the result, the assessee’s appeal is treated as partly allowed for statistical purposes

ITA 123/MUM/2012[2007-08]Status: DisposedITAT Mumbai29 Jan 2016AY 2007-08

Bench: Shri Jason P. Boaz (Am) & Shri Sandeep Gosain (Jm) Assessment Year: 2007-08

For Appellant: Shri. Bhupendra ShahFor Respondent: Shri. M. Dayasagar

Section 142(1)Section 143(1)Section 143(3)Section 234ASection 263Section 54

assessee’s claim for exemption u/s 54 of the Act were called for and examined only in revision proceedings. It is submitted that lack of inquiry and non application of mind by the AO in this regard rendered the order of assessment for Asst. year 2007-08 as erroneous ... case of CIT vs. Sun Beam Auto reported in 227 CTR 113 wherein the Hon'ble High Court has propounded a distinction between lack of inquiry and inadequate inquiry. If there is a lack of enquiry, then the assessment order can be branded as erroneous. The following observations

M/S Kamna Medical Centre Pvt. Ltd., Meerut vs. CIT, Meerut

In the result the order passed u/s 263 of the Act on 25

ITA 3397/DEL/2013[2008-09]Status: DisposedITAT Delhi27 Jan 2016AY 2008-09

Bench: Shri J. Sudhakar Reddy & Shri Kuldip Singhay: 2008-09 Kamna Medical Centre P.Ltd. Vs. Cit, Meerut 472/1, Sharda Road Meerut Pan: Aacck 7672 F (Appellant) (Respondent) Appellant By : Sh.C.S.Anand, Adv. Respondent By : Ms.Sulekha Verma, Cit, D.R. Order

For Appellant: Sh.C.S.Anand, AdvFor Respondent: Ms.Sulekha Verma, CIT, D.R

Section 143(3)Section 36(1)(va)Section 40Section 44Section 44A

Commissioner to pass orders u/s 263 merely because he has a different opinion in the matter; that it is only in cases of lack of inquiry that such a course of action would be open; that an assessment order made by the Income-tax Officer cannot be branded as erroneous

The Commissioner of Income Tax vs. M/S Saravana Developers

Appeal is allowed as the consequential order

ITA/67/2014HC Karnataka21 Jan 2016

Bench: S.SUJATHA,N.K.PATIL

Section 143(3)Section 260Section 260ASection 263

assessment under Section 143(3) of the Act for the Assessment year 2007-08. The learned counsel pointing out the distinction between ‘lack of inquiry’ and ‘inadequate inquiry’ would contend that even if there was inadequate inquiry, that would not itself be a ground to the CIT to invoke Section ... have made further enquires rather than accepting the explanation and in such situation, it cannot be said that it is a case of ‘lack of inquiry’. In this context, it is held that the opinion of the assessing officer in treating the expenditure as revenue expenditure was plausible and thus

Ritesh Kumar Boyed, Kolkata vs. C.I.T Kolkata - Xiv, Kolkata

In the result, appeal by the Assessee is allowed

ITA 2299/KOL/2013[2006-07]Status: DisposedITAT Kolkata15 Jan 2016AY 2006-07

Bench: Hon’Ble Shri N.V.Vasudevan, Jm & Shri Waseem Ahmed, Am] Assessment Year : 2006-07

For Appellant: Shri Subash Agarwal, AdvocateFor Respondent: Shri Sa ndeep Chaube, CIT(DR)

Section 133ASection 143(1)Section 143(3)Section 147Section 148Section 263

regarded as income of the Assessee rather than accepting the explanation. Therefore, it cannot be said that it is a case of 'lack of inquiry'. The decision of the Hon’ble Bombay High Court in the case of Ganbriel India Ltd. (supra) clearly supports the stand taken by the Assessee

ITO, New Delhi vs. M/S. Gold Mohur Profiles Ltd., New Delhi

In the result, the appeal filed by the Revenue is dismissed

ITA 4102/DEL/2013[2004-05]Status: DisposedITAT Delhi18 Dec 2015AY 2004-05

Bench: Sh. Aby T. Varkey & Sh. O.P. Kantassessment Year: 2004-05 Income Tax Officer, Vs. Gold Mohur Profiles Ltd., Ward-12(2), Room No. 337, 31, Gujaranwala Town-Ii, C.R. Building, New Delhi G.T. Karnal Road, New Delhi (Pan: Aaacg2316G) (Appellant) (Respondent) Appellant By : Sh. Amit Jain, Sr. Dr Respondent By : S/Sh. K. Sampath & V. Raja Kumar, Adv. Date Of Hearing: 27.11.2015 Date Of Pronouncement: 18.12.2015 Order Per O.P. Kant, A.M.: The Present Appeal By The Revenue Is Directed Against The Order Dated 02.04.2013 Of Learned Commissioner Of Income Tax(Appeals)-Xv, New Delhi, For The Assessment Year 2004-05, Raising The Following Grounds Of Appeal: I. On The Facts & In The Circumstances Of The Case, The Learned Commissioner Of Income Tax(Appeals) Erred In Deleting The Addition Of Rs. 10,55,000/- U/S 68 Of The I.T. Act, 1961. Ii. On The Facts & In The Circumstances Of The Case, The Learned Commissioner Of Income Tax(Appeals) Erred In Deleting The Addition Of Rs. 10,55,000/- U/S 68 Of The Act Despite The Settled Position Of Law That The Onus Was On The Assessee To Establish The Identity, Creditworthiness & Genuineness Of The Transaction Which Assessee Had Failed To Do. The Learned Commissioner Of Income Tax(Appeals) Has Deleted The Addition Of Rs. 10,55,000/- U/S 68 Of The Act, Disregarding The Finding Of The Department That The Assessee Has Introduced Its Own Unaccounted Money In Its Bank As Accommodation Entries.

For Appellant: Sh. Amit Jain, Sr. DRFor Respondent: S/sh. K. Sampath & V. Raja Kumar, Adv

Section 143(1)Section 148Section 68

applicants. In the case of Gangeshwari Metal (P.) Ltd (supra), the Hon’ble High Court has held that when there was a clear lack of inquiry on the part of the Assessing Officer, once the assessee had furnished all the material, then in such eventuality, no addition could be made ... fall in the second category and are more in line with facts of Lovely Exports (P) Ltd. (supra). There was a clear lack of inquiry on the part of the assessing officer once the assessee had furnished all the material which we have already referred to above. In such

ITO, New Delhi vs. M/S. A.P.S. Foods (P) Ltd., New Delhi

In the result revenue’s appeal is dismissed

ITA 1787/DEL/2012[2003-04]Status: DisposedITAT Delhi17 Dec 2015AY 2003-04

Bench: Shri J. Sudhakar Reddy & Shri A.T. Varkeya.Y. 2003-04

For Appellant: Shri KK Jaiswal, D.RFor Respondent: Shri Satyam Sethi, Adv

Section 68

fall in the second category and are more in line with facts of Lovely Exports (P) Ltd. (supra). There was a clear lack of inquiry on the part of the Assessing Officer once the assessee had furnished all the material which we have already referred to above. In such

Elder It Solutions P.Ltd, Mumbai vs. Pr CIT 4, Mumbai

In the result appeal of the assessee is allowed

ITA 2461/MUM/2015[2010-11]Status: DisposedITAT Mumbai16 Dec 2015AY 2010-11

For Appellant: Shri A.V.SondeFor Respondent: Manjunatha R.Swamy

Section 143(3)Section 263

Officer has raised queries and considered the details filed by the assessee and submissions made and that this is not the case of lack of inquiry or lack of application of mind as made out by the Commissioner in his order u/s.263. Hon‟ble Delhi High Court in the case